Financial Contrast: Loar (NYSE:LOAR) and Archer Aviation (NYSE:ACHR)

Loar (NYSE:LOAR) and Archer Aviation (NYSE:ACHR) are both mid-cap industrials companies, but which is the superior stock? We will compare the two companies based on the strength of their earnings, valuation, analyst recommendations, risk, dividends, institutional ownership and profitability.

Analyst Ratings

This is a summary of current ratings and recommmendations for Loar and Archer Aviation, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Loar	0	2	4	1	2.86
Archer Aviation	1	3	5	0	2.44

Loar currently has a consensus price target of $88.00, suggesting a potential upside of 36.40%. Archer Aviation has a consensus price target of $11.50, suggesting a potential upside of 108.14%. Given Archer Aviation’s higher probable upside, analysts plainly believe Archer Aviation is more favorable than Loar.

Volatility and Risk

Loar has a beta of 0.56, indicating that its stock price is 44% less volatile than the S&P 500. Comparatively, Archer Aviation has a beta of 3.23, indicating that its stock price is 223% more volatile than the S&P 500.

Earnings and Valuation

This table compares Loar and Archer Aviation”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Loar	$586.17 million	10.31	$72.15 million	$0.72	89.61
Archer Aviation	$6.90 million	616.58	-$618.20 million	($1.08)	-5.12

Loar has higher revenue and earnings than Archer Aviation. Archer Aviation is trading at a lower price-to-earnings ratio than Loar, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Loar and Archer Aviation’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Loar	11.60%	9.37%	5.39%
Archer Aviation	N/A	-40.74%	-35.93%

Insider and Institutional Ownership

59.3% of Archer Aviation shares are held by institutional investors. 20.1% of Loar shares are held by company insiders. Comparatively, 5.6% of Archer Aviation shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Summary

Loar beats Archer Aviation on 10 of the 15 factors compared between the two stocks.

About Loar

Loar Holdings Inc., through its subsidiaries, designs, manufactures, and markets aerospace and defense components for aircraft, and aerospace and defense systems in the United States and internationally. It offers products in various categories, which include airframe components, structural components, avionics, composites, braking system components, de-ice and ice protection, electro-mechanical, engineered materials, flight controls, fluid and motion controls, environmental, metal forming, molded components, and restraints and safety devices. The company also provides auto throttles, lap-belt airbags, two-and three-point seat belts, water purification systems, fire barriers, polyimide washers and bushings, latches, hold-open and tie rods, temperature and fluid sensors and switches, carbon and metallic brake discs, fluid and pneumatic-based ice protection, RAM air components, sealing solutions, actuation devices, and others. It primarily serves commercial, business jet and general aviation, and defense markets. Loar Holdings Inc. was founded in 2017 and is headquartered in White Plains, New York.

About Archer Aviation

Archer Aviation Inc., together with its subsidiaries, engages in designs, develops, and operates electric vertical takeoff and landing aircraft for use in urban air mobility. The company was formerly known as Atlas Crest Investment Corp. and changed its name to Archer Aviation Inc. The company is headquartered in San Jose, California.